Inflation is the increase you pay for goods and services over time. The average annual inflation rate since 1913 has been about 3.2% per year in the United States. In some countries the rate of inflation is double digits.
Your purchasing power is reduced every year due to the rise in costs of the same goods and services you bought the year prior. Simply put you need to plan on spending more for the same things in later years.
Not all goods or services increase at the same rate. For example electrical power can increase 7% one year when at the same time food would increase by 3%. There are many factors that drive the rate of inflation.
Beating inflation requires either growing money faster than the inflation rate or making more money faster. The first is usually in an investment, with risk. The second is usually called a raise. Remember this must be done every year; inflation never stops. There are many strategies to beat inflation.
One thing is for certain; Things Cost more with Time!